Amritsar Car Loan

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You can avail a car loan to purchase a car in Amritsar, a city in Punjab, at interest rates ranging between 9.05% and 12.85% to be repaid over a maximum of 7 years. These loans are quickly approved, requires less documentation, and can be repaid in easy equated monthly instalments (EMIs).

How to Fetch Lower Interest Rates in Amritsar

Maintain a low debt-to-income ratio – A low debt-to-income ratio indicates that after meeting your debt obligations, you still have a sufficient portion of your income to be able to pay the EMI for your car loan. There are higher chances of you getting a car loan with a lower interest rate if your debt-to-income ratio is low as that is a reflection of your high repayment capacity.

Keep your credit score above 750 – The minimum score that most lenders look for before offering you a car loan is 750. If you have a score above that, there are chances of lenders offering you a low interest rate on car loans. To ensure that you maintain a healthy credit score, you should check your credit score regularly.

Make a higher down payment – You will need to avail a loan of a lower amount if you make a higher down payment. This, in turn, means that your loan will be paid off quicker. Paying a higher amount as a down payment gives the lenders the impression that you are financially sound and hence, may compel them to offer you a car loan with a lower interest rate.

Negotiate with the lending institutions – Though most lenders have a fixed interest rate on their car loans, they do not mind you negotiating on the interest rates. However, they will acknowledge your request based on factors such as your credit score, your annual income, loan amount, etc. Before you approach other lenders, ensure that you check with your existing lender first. Since they are already aware of your transaction history, there are higher chances of them offering you a lower interest rate.

Compare car loans offered by various lenders – If you wish to avail a car loan with a low interest rate, it is a good idea to explore the benefits offered by various lenders on their car loans. Once you do that, you can compare them before you pick the one that offers the lowest interest rate and that suits your other requirements too.

Eligibility for Availing a Car Loan in Amritsar

Any individual that has a steady source of income is eligible to avail a car loan in Amritsar. The other eligibility criteria that one needs to fulfil for a car loan are given below:

Who Can Avail

Salaried, self-employed individuals and professionals of partnership firms, private and public limited companies, and sole proprietorships

Minimum Age

21 years

Maximum Age

Salaried – 60 years at the end of the loan tenure

Self-employed – 65 years at the end of the loan tenure

Minimum Annual Income

Rs.3 lakh

Business or Job Stability

Salaried – Worked for at least 2 years out of which 1 year should be with the current employer

Self-employed – Should be in the same line of business for at least 2 years

Other Requirements

Should have a telephone/mobile connection

Please note that the above list provides the generic eligibility criteria. Different lenders may have different criteria and hence, it is advised that you check with the lenders before applying for a car loan.

Documents Required

You do not need to provide too many documents while applying for a car loan. You will need a proof of identity, address proof, and income proof, the details of which have been given below:

FAQs on Car Loans in Amritsar

Will my credit score affect my eligibility for a car loan in Amritsar?

Answer: Yes. To be eligible for a car loan in Amritsar, you will need a minimum credit score of 750. If your score is lower than that, the chances of your car loan application getting rejected are higher. Hence, before you apply for a car loan, it is advised that you check your credit score. Doing so will boost your confidence to approach the lender if your score is high and in case it is low, you can take corrective steps to improve it and then apply for the loan.

What will happen if I miss out on paying my EMIs towards my car loan?

Answer: Missing out on making your EMI payments can affect your credit score and ruin your chances of securing a loan in the future. So, it is never a good idea to miss out paying your EMIs. Also, if you miss out on your car loan EMI for more than 6 months, the lender can seize your vehicle and auction it to recover the outstanding loan amount since your vehicle is hypothecated with the lender.

Can I close my car loan before my tenure ends?

Answer: Yes, you can foreclose your loan before the end of your loan tenure by paying the outstanding loan amount. Many banks will charge you a penalty fee on loan foreclosure and hence, you should check for the charges with your lender before foreclosing your loan.

Do I have to pay the processing fees before or after getting the car loan?

Answer: Processing fee on a car loan needs to be paid upfront, while making the loan application. However, other charges such as stamp duty charge, cheque swap charge, documentation charges, etc., if applicable, need to be paid later.

I am a small business owner. Am I eligible for a car loan in Amritsar?

Answer: Yes, anyone who has a steady source of income is eligible for a car loan in Amritsar. However, you will have to be in the same line of business for at least 2 years and fulfill the minimum income criteria specified by the lender.

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